Associated enterprise rules permit profit adjustments when intercompany terms deviate from independent transactions, allowing inclusion of unrealized profits for tax. The rule applies where cross-border participation in management, control or capital creates intercompany terms differing from independent enterprises; in such cases profits that would have accrued but for those terms may be included in an enterprise's taxable income and taxed accordingly to reflect arm's length results.
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Provisions expressly mentioned in the judgment/order text.
Associated enterprise rules permit profit adjustments when intercompany terms deviate from independent transactions, allowing inclusion of unrealized profits for tax.
The rule applies where cross-border participation in management, control or capital creates intercompany terms differing from independent enterprises; in such cases profits that would have accrued but for those terms may be included in an enterprise's taxable income and taxed accordingly to reflect arm's length results.
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